It links downtown Bilbao with the recreational area at the summit of the nearby Artxanda Mountain, which has a park, several restaurants, a hotel, a sports complex, and offers panoramic views of the city.

A cable railway to the top of the Artxanda mountain was first proposed in 1901, but not built due to lack of finance.

The funicular closed in 1976 after an accident that injured several employees of the operating company, and did not reopen again until April 1983.

The line was closed again in August of the same year, as a result of flood damage, and did not reopen until November.

[2] The Bilbao departure point of the funicular is just north of Zubizuri bridge, on the right bank of the River Nervion, within walking distance of the Guggenheim Museum.